The excellent Dame Julie Moore has left her job in Birmingham. In her valedictory interview with the HSJ, she points out that one of her most recent problems was caused by the regulators inability to help her very much in her efforts to take over the Heart of England Hospital. In fact, she said, they got in the way.
In the next few years the NHS is going to need a number of good organisations to take over organisations that need help. Given this policy need and the risks contained in not doing this, the NHS has to get better at helping good leaders do this.
She is not alone in finding the regulator unhelpful here. On other occasions successful trusts have been asked to ‘help’ a problematic trust by NHSI and its predecessors. However, once they have started to provide that help the regulator has treated the new relationship between the trusts as if it were something the good trust cooked up on its own and that therefore they need a lot more monitoring.
Takeovers are a big risk, and it would seem that once a regulator has persuaded a good trust to take part, it becomes very jumpy about having done so.
In every services sector and industry, takeovers are problematic. In the private sector it’s estimated that only 25% of takeovers provide more shareholder value from the new organisation than existed in the two old ones. That’s not a good track record for something that is such a common method by which businesses attempt to improve their outputs. It looks to be inherently full of risk
And yet as both Julie Moore and David Dalton have recently pointed out, we probably need fewer organisations of providers in the NHS. Do we need the full panoply of executive and non-executive governance for all the trusts that currently exist? And if we don’t, we need to simplify the process by which good trusts work with those that are not so good.
A few weeks ago David Dalton resurrected the idea of developing chains of franchised trusts. Here governance would be developed across the chain rather than within each organisation. This was a good idea when he launched it at the time of the Five Year forward view – and it’s a good idea again now. I am sure it will find its way into the 10 year plan being constructed now and launched in November.
But to turn it into something more than a good idea, NHSI is going to have to work to help create the conditions where it can work. Which means that recognising the status quo probably contains more risk than doing something about it. But at the moment anyone bold enough to try something new has to not only take all the risk but is given more regulation for doing it.
One of the main ways we have to do this is to be more honest about what is often going on here. What we often call a merger, usually isn’t. It’s a takeover. For a variety of financial or quality reasons, a better organisation is being asked to take over another organisation that has problems.
This is often called a merger to try and make the organisation being taken over feel happier about what is happening. The word merger leaves them feeling that they have the same rights to contribute to the new organisation as the one with which they are merging, and of course that makes them feel better.
But the point of the takeover is that this is not the case. It’s simple really. The point of the takeover is that the new joint organisation will be better than the two separate ones. If it’s going to work the one that was not so good needs to improve a lot, and if the organisation that needs to improve a lot gets the feeling that what they are doing at the moment is OK then they don’t really have to change.
But the whole point of the action is that they do have to change and that they have the opportunity to do so with the assistance of an organisation that knows how to do it.
The organisation coming in to help needs to be given the recognition that they have something to teach and the one that needs help needs to recognise that they have something to learn.
We need to stop calling this a merger and be honest about what is really happening.